The ONS released the sales figures for June on Thursday, retail values were up by 4% compared to June last year but underlying volumes were up by 0.4%. For the second quarter sales were flat at 0.3%. No wonder the sales signs are out all over the high street. A combination of high inflation, the VAT rise, real income falls, higher energy, utility bills and food costs are hitting consumers and retailers badly.
Household goods store volumes were down by 3.7% but non store retail sales particularly on line internet sales were up by 24%. Retail is facing a “disruptive” challenge from the swing to more “clicks than bricks” in consumer buying patterns. Internet retail sales volumes accounted 9.9% of all transactions compared to 6.8% in June last year.
What is happening to food retailing? Volumes were down by over 4.2% in the month (See inset). This has been a trend over the last two years. Either we are becoming a nation of slimmers are a greater and greater proportion of conventional food retailing is moving on line.
In the second half of the year, it is difficult to see why retail fortunes should change. It’s tough on the high street and it looks like this could continue for the rest of the year. Christmas cannot come early enough. For many, it will be too late.
The views expressed are my own and in no way reflect pro.manchester policy. In no way should the comments be considered as investment advice or guidelines or reflect political bias. UK Economics news and analysis : no politics, no dogma, no polemics, just facts. JKA is a visiting professor at MMU Business School, an economist and specialist in Corporate Strategy, educated at LSE, London Business School with a PhD from Manchester Metropolitan University.